Reading time ( words)
Libya's defense expenditure is anticipated to value US$16.4 billion on a cumulative basis over the forecast period. The Libyan defense industry, valued at US$3.1 billion in 2019, is projected to record a CAGR of 1.51% over the forecast period, to reach US$3.4 billion in 2024. On a cumulative basis, expenditure over 2020-2024 is anticipated to be US$16.4 billion compared to US$14.5 billion spent during the historic period. After the 2011 revolution, the country's initial focus on reconstructing and strengthening its security forces has resulted in an increase in the Libya's military expenditure.
Libya has suffered an absence of security and the government is merely an entity with no authority. The country is still struggling to establish political, military, and economic stability even after holding elections in July 2012, enabling the shift of power to the democratically elected General National Congress (GNC). However, the country has been grappling with rampant anarchy across much of the country and the incumbent provisional Libyan government headed by Fayez al-Sarraj requested military assistance from NATO and the US in February 2017.
The country's capital expenditure is expected to increase from US$562.2 million in 2020 to US$588.7 million in 2024, growing at a CAGR of 1.15%. It is anticipated that, the Libyan government will spend on the procurement of armored vehicles, military aircraft, engines, combat helicopters and other surveillance equipment. Business opportunities will arise in the form of security platforms as the country looks to strengthen its borders.
Between 2014 and 2018, Egypt emerged as the largest supplier of arms, with a share of 31.2% of total defense imports, followed by UAE and Belarus with 28.0% and 15.1% respectively. Aircraft accounted for the majority of defense imports with a share of 46.8% during the historic period. As Libya plans to increase its defense budget and procure more weapons to increase its military base and countries like Egypt and UAE partially lifting arms embargo ban as well Russia reinitiating its $2 billion deal, imports are expected to increase during the forecast period.